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Insights into the Ohio Supreme Court’s Views on Insurance Coverage

The Ohio Supreme Court reviews only a small percentage of the cases decided by lower appellate courts. This is due largely to the Supreme Court’s limited resources—Ohio has only one Supreme Court, of course, but it has 12 district courts of appeal, all of which generate opinions that could be further appealed. In addition, federal courts can request that the Ohio Supreme Court review certified questions of Ohio law.

The Ohio Supreme Court, therefore, must be highly selective. Nonetheless, in a typical year it does review a substantial number of insurance cases, in part because such cases frequently meet the Court’s discretionary review standard of “public or great general interest.” Also, insurance cases often present complicated or close questions that at times are decided in conflicting ways by Ohio’s lower appellate courts, which is an additional basis for review by the Ohio Supreme Court.

Many of the insurance cases that reach the Ohio Supreme Court concern uninsured or underinsured motorist claims, because such claims are both relatively common and highly regulated. Although these claims in and of themselves may not be interesting to most policyholders, or, particularly, to commercial policyholders, the cases they generate are meaningful for all policyholders with an interest in Ohio law, because they frequently provide insight into the Ohio Supreme Court’s views on insurance matters generally.

A recent case that provides useful insight into the Ohio Supreme Court’s insurance views is the uninsured/underinsured motorist insurance case of Smith v. Erie Ins. Co., 2016-Ohio-7742. In that case, a policyholder of Erie Insurance Company made an uninsured motorist insurance claim based upon his allegations that an unidentified vehicle crossed a center line late one evening, causing him to crash his pickup truck into some roadside trees when he swerved to avoid contact with the oncoming vehicle. The insured driver alleged that the two vehicles did not make contact and that the other vehicle fled the scene. There were no witnesses to the accident, but the insured driver called 9-1-1 to report it at the time and the highway patrol responded and generated an accident report. The report memorialized the insured driver’s description of the events and noted that the accident occurred on a flat, dry segment of road. The report made no mention of any impairment of or excessive speed by the insured driver.

At issue was whether the claim satisfied the following policy requirement for uninsured motorist coverage:

The identity of the driver and owner of the hit-and-run vehicle must be unknown and there must be independent corroborative evidence that the negligence or intentional acts of the driver of the hit-and-run vehicle caused the bodily injury. Testimony of [the insured] seeking recovery does not constitute independent corroborative evidence, unless the testimony is supported by additional evidence.

The policy did not define the types of “additional evidence” that would satisfy the requirement of such “support” for the insured’s testimony.

The trial court entered summary judgment for the insurance company. The appellate court reversed and ruled in favor of the policyholder. The appellate court, further, determined that its ruling conflicted with a ruling in another case by a separate appellate court, and the Ohio Supreme Court accepted review of the case on that basis. The Court described the issue as being “whether the policy language is ambiguous leading to an interpretation in favor of the insured that any evidence apart from insured’s testimony, either derived from the insured’s testimony or not, is sufficient to constitute ‘additional evidence’ under the policy ….”

In holding in favor of the policyholder, the Ohio Supreme Court focused on the policy language, the 9-1-1 call transcript, and the police report. Although both the call transcript and police report could be regarded as merely containing alternative expressions of the policyholder’s own testimony, the Court stated:

We hold that the language at issue is certainly susceptible of the interpretation that any evidence apart from the insured’s testimony, either derived from the insured’s testimony or not, is sufficient to constitute “additional evidence” under the policy.

The Court, though, was not unanimous in this view. Although the policyholder prevailed, the Court split by a vote of four to three, with the three dissenting justices disagreeing with the majority about whether the contract language was susceptible to multiple reasonable interpretations and about whether differing forms of the policyholder’s own testimony could serve to corroborate that testimony.

This case is instructive in at least three respects. First, the 4-3 decision, in which both the majority and minority included lengthy opinions, demonstrates that the Court, when asked to do so, will look closely at insurance coverage issues from all angles. Second, the decision provides a cautionary note to insurers about the difficulty of crafting policy language that will operate effectively to broadly exclude coverage. Finally, the decision demonstrates that the Ohio Supreme Court will scrutinize purportedly exclusionary language to determine whether it may be reasonably interpreted in favor of coverage. If so, consistent with longstanding Ohio law, the Court will apply that interpretation to the benefit of policyholders.

Compare jurisdictions: Litigation: Enforcement of Foreign Judgments

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